AFIAA Global increases real estate assets to two billion CHF
The AFIAA Foundation for Real Estate Investments Abroad significantly expanded the real estate assets of its AFIAA Global investment group during the financial year. They grew by around 30 percent to approximately CHF 2 billion.
The AFIAA Global investment group comprises directly held real estate in international locations outside Switzerland. Real estate assets increased by CHF 478 million to around CHF two billion as of December 31, 2017, an increase of 31 percent compared to the previous year. "This means that we have already achieved around two-thirds of the goal formulated in our Strategy 2016+ of expanding directly held real estate assets to a volume of around CHF three billion in terms of value by 2021," says Ingo Bofinger, CEO of AFIAA.
Appreciation gains of 88.5 million were recorded during the fiscal year, reflecting continued declines in real estate market yields and asset management, particularly a number of new leases, AFIAA says.
Ninety-three percent of the investments of the AFIAA Global investment group are allocated to the Core and Core+ categories. The remaining seven percent are attributable to the Value Added category, a decrease of ten percent compared with the previous year. Including the office building in London acquired in December 2017 the portfolio currently comprises 28 properties. Office use dominates with 86 percent of the space in the portfolio, followed by retail space with eleven percent. The geographical focus is on Germany (25%), followed by the USA and Australia (22% each) and the UK (20%).
The leverage ratio (LTV) is 16.12 percent of the market values of the properties. The return on investment (change in net asset value) totaled 7.54 percent in 2017. Adjusted for currency effects, the return on investment was 9.73 percent.
"Our transaction pipeline for the coming months is well filled," says Sebastian Feix, Global Head of Transactions at AFIAA. The focus is on the target markets of Europe, North America and Australia. AFIAA Global will focus on acquiring office and retail properties with an investment volume of 50 to 150 million. In parallel to further acquisitions, the market situation will continue to be used for portfolio adjustments.
In addition to the AFIAA Global investment group, the investment foundation also offers an indirectly investing product, AFIAA Diversified indirect. Through its two investment groups, the company manages real estate assets of around CHF 2.2 billion (as of December 31, 2017).
